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North Korea celebrated the test as a necessary self-defence victory

The US has tabled a UN resolution - agreed with China - for sanctions that would target North Korea's diplomats and cash transfers.

Washington's UN ambassador Susan Rice said they would be "some of the toughest sanctions" the UN had imposed.

Li Baodong, China's UN envoy, said a "strong signal" had to be sent following North Korea's third and most powerful nuclear test last month.

Earlier, Pyongyang warned it would scrap a 60-year Korean ceasefire.

North Korea's military command said it would end the truce with South Korea on 11 March because of the threat of sanctions and the current military exercises taking place in South Korea.

"We aim to launch surgical strikes at any time and any target without being bounded by the armistice accord and advance our long-cherished wish for national unification," the statement said.

The Korean War ended with an armistice in 1953 - not a peace treaty - meaning the peninsula is still technically at war.

'Strong signal'

"For the first time ever, this resolution targets the illicit activities of North Korean diplomatic personnel, North Korean banking relationships [and] illicit transfers of bulk cash," Susan Rice said after a closed-door consultation on the draft with the 15 members of the Security Council.

The 1953 cease-fire

The agreement provided for:

A suspension of open hostilities

A fixed demarcation line with a four kilometre (2.4 mile) buffer zone ("demilitarisation zone")

"The breadth and scope of these sanctions is exceptional and demonstrates the strength of the international community's commitment to denuclearisation" of the Korean peninsula, she told reporters.

The resolution also pledges to take further measures should North Korea carry out another missile launch or nuclear test, she said.

She said she hoped the Security Council would vote on the draft resolution this week.

Li Baodong said China supported the move, but added: "We think that action should be proportionate, should be balanced and focused on bringing down the tension and focusing on the diplomatic track.

"A strong signal must be sent out that a nuclear test is against the will of the international community," he told Reuters news agency.

China is North Korea's only ally and its major trading partner. Beijing has in the past been reluctant to support tougher sanctions, citing the impact of potential instability inside its secretive neighbour state.

February's nuclear test was the first of its kind under new leader Kim Jong-un, who took over the leadership after his father Kim Jong-il died in December 2011.

Nuclear test monitors based in Vienna say the underground explosion had double the force of the last test, in 2009, despite the use of a device said by the North to be smaller.

North Korea claimed that a "miniaturised" device had been tested, increasing fears that Pyongyang had moved closer to building a warhead small enough to arm a missile.

Pyongyang said the test was a "self-defensive measure" made necessary by the "continued hostility" of the US.

It came weeks after Pyongyang successfully used a rocket to put a satellite into space, a move condemned by the UN as a banned test of missile technology.